Calcutta High Court
Principal Commissioner Of Income ... vs M/S. Berger Paints India Limited on 2 February, 2022
OD - 4
IN THE HIGH COURT AT CALCUTTA
SPECIAL JURISDICTION (INCOME TAX)
ORIGINAL SIDE
IA NO.GA/2/2017 (Old No. GA/1879/2017)
In
ITAT/223/2017
PRINCIPAL COMMISSIONER OF INCOME TAX, KOLKATA - 4,
VS.
M/S. BERGER PAINTS INDIA LIMITED
BEFORE :
THE HON'BLE JUSTICE T.S. SIVAGNANAM
AND
THE HON'BLE JUSTICE HIRANMAY BHATTACHARYYA
Date : February 2, 2022.
[Via Video Conference]
Appearance :
Mr. P.K. Bhowmik, Adv.
... for the appellant
Mr. J.P. Khaitan, Sr. Adv.
Ms. Nilanjana Banerjee Pal, Adv.
..for the respondent
The Court : This appeal filed by the revenue under Section 260A
of the Income Tax Act, 1961 ('the Act' for brevity) is directed against
the order dated 23rd November, 2016 passed by the Income Tax
Appellate Tribunal "A" Bench, Kolkata (Tribunal) in ITA No.
2112/Kol/2013 for the assessment year 2006-07.
The revenue has raised the following substantial questions of
law for consideration :
1. Whether on the facts and in the circumstances of the case
the Learned Tribunal has erred in law in allowing the
deduction claimed by the assessee under Section 80IB of
Income Tax Act, 1961 for an aggregate amount of
Rs.33,81,19,725/- instead of Rs.30,21,88,063/- allowed
by the Assessing Officer?
2. Whether on the facts and in the circumstances of the case
the Learned Tribunal has erred in law in rejecting the
methodology of deduction under Section 80IB of Income
Tax Act, 1961 computed by the Assessing Officer?
3. Whether on the facts and in the circumstances of the case
conclusion arrived at by the Learned Tribunal in allowing
the deduction under Section 80IB of the Income Tax Act,
1961 for an aggregate amount of Rs.33,81,19,725/-
claimed by the Assessee instead of Rs.30,21,88,063/- as
allowed by the Assessing Officer, is perverse?
We have heard Mr. P.K. Bhowmik, learned standing counsel for
the appellant/revenue and Mr. J.P. Khaitan, learned senior counsel
duly assisted by Ms. Nilanjana Banerjee Pal, learned counsel for the
respondent/assessee.
The above substantial questions of law were considered by us in
the assessee's own case for the assessment year 2008-09 in ITA No.
256 of 2017 and by judgment dated 14th December, 2021, the appeal
filed by the revenue was dismissed. The said judgment is as follows :
"The revenue has raised the following substantial
questions of law for consideration:
i) Whether on the facts and in the circumstances of
the case the Learned Tribunal has erred in law in upholding the
order of CIT(Appeal) in allowing deduction under Section 80IB of
Income Tax Act, 1961 in respect of "common expenses" of
Rs.10,21,06,200/- in respect of its Units at Pandicharry, Goa
and Jammu by dis-regarding that it was not correctly
apportioned ?
ii) Whether on the facts and in the circumstances of
the case the Learned Tribunal has erred in law in upholding the
order of CIT (Appeal) in allowing deduction under Section 80IB of
Income Tax Act, 1961 in respect of "interest income" of
Rs.57,93,000/- on sale of scrap by treating it as income derived
from profits and gains of industrial undertaking?
iii) Whether on the facts and in the circumstances of
the case the Learned Tribunal has erred in law in deleting the
addition of Rs.38,07,778/- made by the Assessing Officer under
Section 14A of the Income Tax Act, 1961 read with Rule 8D of
the Income Tax Rules, 1962 by disregarding that there were
borrowed capitals of Rs.78.05 crores and investments out of
such borrowed funds were also made in making investments
that yielded exempt income?
We have heard Mr. P. K. Bhowmik, learned standing
Counsel assisted by Mr. Madhu Jana, learned junior standing
counsel appearing for the appellant/revenue and Mr. J.P.
Khaitan, learned Senior Counsel assisted by Mrs. Nilanjana
Banerjee Pal, learned junior standing Counsel appearing for the
respondent/assessee.
So far as the first substantial question of law is
concerned, the Tribunal followed the assessee's own case for the
assessment years, namely, 2000-01 and 2001-02 and allowed the
deduction as claimed under Section 80IB of the Act. As against
the said order of the Tribunal, the revenue preferred appeal before
this Court and the appeal preferred by the revenue in ITA No.117
of 2009 was dismissed by a judgement dated 20th November, 2009
on the ground of unexplained and inordinate delay.
With regard to the assessment year 2002-03, the Tribunal
granted relief to the assessee and the revenue carried the matter
on appeal to this Court in ITA No.230 of 2009 which was
dismissed by judgement dated 2nd September, 2019 on the ground
that no question of law arises for consideration. Thus, the
decision rendered by the Tribunal does not call for any
interference.
The second substantial question of law concerns the claim
for deduction under Section 80IB on the sale of scrap. This issue
is no longer res integra and there are several decisions which are
in favour of the assessee and the Tribunal had followed the
decision of this Court in the case of Reckitt Benckiser (India) Ltd.
-vs- Additional Commissioner of Income Tax, Range -12, Kolkata,
reported in [2015] 56 taxmann.com 415 (Calcutta) and granted
relief to the assessee. We find that the revenue has not made out
any ground to interfere with the said finding rendered by the
Tribunal which is taken note of the correct legal position.
With regard to the third substantial question of law, the
Tribunal granted relief taking note of the decision in favour of the
assessee by placing reliance in the case of Commissioner of
Income Tax, Central-I, Calcutta -vs- Ashish Jhunjhunwala,
reported in 2015(12) TMI 905. The said decision lays down the
correct legal principle. Therefore, there is no error in the order
passed by the Tribunal.
In the result, the appeal fails and the same stands
dismissed. The substantial questions of law are answered against
the revenue.
The connected application also stands dismissed."
Thus, following the above decision of the assessee's own case,
this appeal filed by the revenue is dismissed and the substantial
questions of law are answered against the revenue.
Consequently, the stay application stands dismissed.
(T. S. SIVAGNANAM, J.)
(HIRANMAY BHATTACHARYYA, J.)
RS/GH
